Roth/MKM maintained a positive stance on Bitdeer Technologies Group (NASDAQ:BTDR), reiterating its Buy rating and a $14.00 price target for the company's stock. The firm highlighted the impressive results from Bitdeer's approximately 790MW of capacity in Ohio, which underscore the substantial growth potential for High-Performance Computing (HPC).
The analyst pointed out that the next crucial steps for Bitdeer involve confirming the feasibility of its projects and initiating construction. Although the completion of the site is not expected until 2026-2027, the progress made in the HPC segment is seen as a potential driver for a significant revaluation of the company's shares. The Ohio capacity is projected to potentially generate $850 million in annual recurring revenue (ARR) and achieve profit margins between 60% and 70% once fully developed.
Bitdeer's advancement in HPC, including letters of intent (LOIs) and signed customer contracts, is anticipated to have a more substantial impact on the company's valuation than any gains from vertical integration in the Bitcoin (BTC) space. The firm suggests that these tangible steps forward in HPC could be the next catalyst for the company's stock performance.
The analysis from Roth/MKM comes as Bitdeer Technologies Group continues to focus on expanding its HPC capabilities. The company's strategic moves in this area are closely watched by investors, as they could significantly influence Bitdeer's financial outlook and market positioning in the years leading up to the site's expected delivery.
In other recent news, Bitdeer Technologies Group reported steady mining operations in September, mining 164 Bitcoins, and maintaining a consistent performance from the previous month. The company's SEALMINER A1's mass production is on track for Q4 2024, expected to add 3.4 EH/s to Bitdeer’s proprietary hashrate. In financial developments, Bitdeer successfully completed an offering of $172.5 million in convertible senior notes due 2029.
Bitdeer's Q2 2024 earnings report revealed revenues of $99.2 million, falling short of the consensus estimate of $108.4 million. Despite this, Needham maintained its Buy rating on Bitdeer, even though the firm lowered its 2024 revenue estimates for the company from $426 million to $352 million. Analyst firms such as Roth/MKM and Rosenblatt Securities have reiterated their Buy ratings on Bitdeer, highlighting the company's potential in the high-performance computing and artificial intelligence energy infrastructure sector.
Bitdeer is also scaling up its self-mining activities with the SEALMINER and has announced plans for an additional 1.6 gigawatts of expansion. The company is progressing on several sites, with the Tydal, Norway, phase 1 site's 40 MW expansion and the Rockdale, Texas, 100 MW hydro-cooling conversion site both on track for phased completion from Q4 2024 to Q1 2025.
InvestingPro Insights
Bitdeer Technologies Group's (NASDAQ:BTDR) strategic focus on High-Performance Computing (HPC) aligns with its current financial position and market performance. According to InvestingPro data, the company's revenue growth stands at an impressive 31.48% over the last twelve months as of Q2 2024, indicating strong business momentum that could support its ambitious HPC projects.
However, investors should note that Bitdeer is currently not profitable, with an operating income margin of -4.33% over the same period. This aligns with an InvestingPro Tip suggesting that the company is "quickly burning through cash." Despite this, another InvestingPro Tip highlights that Bitdeer "holds more cash than debt on its balance sheet," which could provide some financial flexibility as it pursues its growth initiatives in Ohio.
The stock's recent performance has been volatile, with a strong 15.5% return over the last month, but a significant 41.42% decline over the past three months. This volatility is reflected in an InvestingPro Tip stating that "stock price movements are quite volatile," which investors should consider when evaluating the potential impact of Bitdeer's HPC developments on its stock price.
For those interested in a deeper analysis, InvestingPro offers 11 additional tips for Bitdeer Technologies Group, providing a more comprehensive view of the company's financial health and market position.
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